2 founders who sold their last startup for more than $20 million have raised $1 million to build a cheaper, less frustrating AT&T

caption
Ilan Yarden, David Arabov, and Greg Dybec are the founding members of Wing.
source
Wing

  • Wing is a telecom service provider that uses Sprint’s
    cellphone towers to offer competitive data plans.
  • The company was founded by the team behind the
    lifestyle media site Elite Daily, which sold for about $26
    million in 2015.
  • Wing lets customers track their data usage using an
    app, and its average plan costs about $35 a month.

After selling the lifestyle media site Elite Daily
for about $26 million in 2015
, David Arabov and Jonathon
Francis took only a short time off before embarking on their next
entrepreneurial endeavor.

This time, the serial startup founders are building a telecom company called Wing
that promises competitive data-usage plans, accessible customer
service, and transparency when it comes to billing. The company
is born out of the cofounders’ shared frustration with the big
four telecom companies: Verizon, Sprint, AT&T, T-Mobile.

Arabov told Business Insider that his dealings with his former
service provider, AT&T, always resulted in a complicated
experience.

"Any time they messed up on my bill, I’d call up AT&T, and it
would always take about an hour to get someone on the phone,"
Arabov said. "I always wondered, ‘Why is this so difficult?’"

Arabov’s dealings with AT&T made him realize that there was
room for improvement.

Wing

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Wing sends prospective customers a punch-out SIM card and a pin to pull out the smartphone SIM tray.
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Wing

"The frustration built up over time, and then suddenly we had a
lightbulb moment," he said. "We decided that enough is enough,
and we put our heads down to find a solution."

When it comes to building a telecom company, the biggest hurdle
lies in securing access to cellphone towers, Arabov said.

"We realized that it was close to impossible to put up our own
towers just because of how expensive it is," he said. "We learned
pretty quickly that we would need an agreement with a bigger
carrier to lease space on their towers."

Luckily, a cold email to a Sprint executive resulted in a meeting
with the telecom company and, a few months later, an agreement.
Wing landed a deal to use Sprint’s cell towers for a monthly fee.

Despite using the cell towers of a telecom provider that is
technically his company’s competitor, Arabov said there wasn’t
any conflict of interest at stake. He also doesn’t think Sprint
would kick Wing off its towers if the service grew into enough of
a threat.

"The bigger we get, the more attractive we become to a big
carrier," Arabov said. "Historically, there’s no turnoff for
getting too big. Anyone that does have an agreement like this
usually gets acquired."

Arabov described the exchange as a mutually beneficial agreement,
with Sprint profiting from its excess bandwidth through Wing’s
new customers.

Wing has a 10-minute setup over text message with easy-to-read
mobile statements

While Wing and Sprint might share cell towers, Arabov said there
were plenty of differences between the two companies.

Wing

caption
A screenshot of what Wing’s data-usage plan looks like.
source
Wing

Unlike many providers, Wing gives its customers a clear
understanding of how much data they’re using on their plan,
viewable in Wing’s mobile app. And if a customer doesn’t use the
entirety of their data plan, Wing puts the dollar amount in
unused data toward their next plan so that they’re paying only
for what they use.

If a new customer is unhappy with Wing, the company lets them
walk away with relative ease.

"If you sign up for 30 days and want to quit, we let you," Arabov
said. "We try to make it as pain-free as possible."

Arabov said that on average, Wing’s customers pay a flat $35
monthly rate with its 3 GB plan. For comparison, that’s
the estimated amount
Verizon charges for its monthly 2 GB
plan. And while Sprint offers a similarly priced rate for 3 GB,
there are said to be
several sizable hidden fees
associated with the cost.

Though they’re cheaper, Wing’s plans are priced for
profitability, Arabov said.

If you choose to ditch your provider and switch to Wing, the
company sends a small box containing a punch-out SIM card and a
pin to pull out the smartphone SIM tray. Most of the company’s
customer conversion takes place over text message and social
media, something Arabov described as a major selling point.

"People don’t want to walk into stores or be put on hold
anymore," Arabov said. "I’d say that an average switch to Wing
takes 10 to 15 minutes tops."

Since launching, Wing has received $1 million in funding from
investors including Sinai Ventures and Transcendent Holdings.

While the company declined to say how many customers it has,
Arabov says more than 8,000 people have inquired about Wing,
including 3,000 in the first 48 hours after YouTube star Joe
Santagato – who’s still a Wing user – promoted it.

Arabov hinted that he has big plans for his company.

"We’re just now starting to scale on the marketing side," Arabov
said. "Not one day has gone by where we don’t get new signups."

But change lingers in the backdrop of Wing’s business plan. If
approved, the Sprint and T-Mobile merger
would pare down the competition
in the mobile-networking
space to three major service providers. And Wing currently relies
on Sprint to stay in business.

Arabov isn’t concerned. He says that seismic shift would only
bring more customers to his business.

"The merger will only enhance our service," Arabov said. "There
will be less retail competition, creating a fantastic opportunity
for us, because there will be a lot of frustrated customers."

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